FG offers N450b bonds to investors

The Federal Government has plans to raise N450 billion from the investing public in a new debt issuance aimed at bridging the government’s deficit and deepening the domestic capital market.

It was learnt last night that the Debt Management Office (DMO), which oversees the issuance and management of Nigeria’s sovereign debts, will today conduct a primary market auction (PMA) for three issuances, through which it aimed to raise the funds.

The three bonds on offer included, a new issuance- the three-year FGN March 2027 and reopening of the seven-year, 18.50 per cent FGN February 2031 and the 10-year, 19.00 per cent FGN February 2034 bonds.

However, market pundits said the final allotment may triple given the recent trend in oversubscription of government issuances and final allotments.

A similar PMA for the sale of Nigerian Treasury Bills (NTBs) by the Central Bank of Nigeria (CBN) recorded oversubscription of more than 827 per cent, enabling the government to significantly scale up its final capital raising.

While the apex bank had offered N728.2 million 91-day instruments, subscription was N85.5 billion, with the government finally allotting N5.7 billion. Initial offer size for 182-day NTBs was N918.4 million as against subscription of N49.7 billion. Final allotment for the 182-day NTBs was N4.9 billion.

Also, the initial offer size for 364-day NTBs was N159.9 billion, but subscription totaled N1.4 trillion with final allotment reduced to N150.8 billion.

Nigeria has seen a strong demand for its sovereign issuances on the back of government’s assurance that Nigeria’s economic condition was not so bad that the country would require external assistance in restructuring its debts.



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